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Keeping small-scale wind energy alive<br> State grant program for wind turbines has received 17 applications as national popularity slows

As small- and large-scale wind energy investment show signs of slowing nationally, a state grant program seeks to keep the small-scale wind energy movement alive in New York State.

The New York State Energy Research and Development Authority's 4-month-old grant program has received at least 17 applications seeking more than $712,000, an average of more than $41,000 each. All the grants, which usually cover about one-third of the purchase and installation of a wind turbine, would go to farms and homes.

Jody Duggan-Lay of Pavilion in Wyoming County and her husband paid about $25,000 for the wind turbine they installed on their small farm after receiving a NYSERDA grant and a surprise federal tax credit.

"It really has cut our electric bill dramatically," she said. "We pay about $40 to $60 a month. About half of it is supply costs we pay for being connected to the grid. A couple of years ago, in winter, the bill was $250 a month. Obviously, it's way down from there."

Duggan-Lay's 10-kilowatt windmill has the capacity most homes would need. The cost for such a turbine ranges roughly from $35,000 to $50,000.

The owners of wind generators are allowed to send electricity back to the grid when they have excess. This allows them to accrue credits that they can use to pay for power from the grid when the wind is too light to make power.

Nationally, the growth of small wind projects -- those under 100 kilowatts -- appears to have slowed or leveled off in 2010 after rising 15 percent in 2009 and 78 percent in 2008, although final data will not be available for a couple of months. Large-scale wind installations, which had flourished for several years, plummeted by 72 percent last year, according to the American Wind Energy Association.

New York is ranked eighth in installed wind capacity and first in the Northeast. Although experts expect small wind to show significant growth, New York's overall wind capacity in megawatts was flat from 2009 to 2010.

Experts cite the NYSERDA grants and similar programs as a reason some states continue to see larger boosts in small wind investment.

"Depending on the state, I'd say an increase is true," said Andy Cruz, activist and founder of Arizona-based Southwest Windpower. "If you have better incentives, you will definitely see an increase in the market."

The eight-year federal Investment Tax Credit, passed in 2008, is one reason small wind is expected to thrive in the future.

But the fleetingness of federal incentives for larger-scale projects is partly why overall wind installation is now one half the rate of Europe's and one-third that of China, experts say. The falling prices of fossil fuels like coal and natural gas also have made wind energy less economical.

"The number one reason is that the U.S. needs a 10- to 20-year program," said wind installer Thomas Fleckenstein, co-founder of Niagara Wind and Solar in Niagara Falls. "Utilities and businesses are not going to continue to invest if they don't know what will happen in two years."

Only 16 percent of projected utility-level electricity installation between now and 2014 is expected to be wind, whereas 48 percent and 23 percent are expected to be natural gas and coal, respectively, according to the U.S. Energy Information Administration. Of that 16 percent, only 6 percent is set to occur after 2012, when the federal production tax credit of 2009 expires.

"The incentive expiring in 2012 probably has hurt large-scale wind in the U.S.," Cruz said. "There are long incentives and subsidies for fossil fuels. If the government leveled the playing field, we would see significant growth in (wind energy)."

Beyond policy, experts also point to the recession, the credit crunch and declines in electricity demand.

"Obviously, with the recession and financial issues all across the country, not many projects were going on," said Carol Murphy, executive director of Alliance for Clean Energy New York. "It is better to look at what we have installed in the 2011 and 2012 time frame while federal tax credits are still in place."

Renewable energy sources like wind are favored for their gentler environmental impact, the goal of eventual U.S. energy independence and cost reduction, which is why the U.S. Department of Energy aims to have wind satisfy 20 percent of electricity demand by 2030. Current trends, similar to 2007 levels, could imperil that goal.

At the state level, NYSERDA is scheduled to announce a $250 million grant program for large-scale renewable energy projects Monday. The program seeks proposals and awards incentives, which are based on how much power will be generated, over 10 years once the projects are up and running. The competitive program, the Renewable Portfolio Standard, has awarded funding to 14 wind farms since its creation in 2004.

In New York, anecdotal evidence suggests rapid growth in small wind over 2010 and the preceding years. Consumers are taking advantage of grants, which usually cover up to 30 percent of purchase and installation costs. Experts say electrical bills can drop from 10 to 90 percent, which varies with location, weather and consumption.

Most small or residential windmills do not exceed 120 feet, placing them in the height range of tall trees. The average cost of the turbines Fleckenstein installs is about $70,000. The generators, up to 100 kilowatts, are about the size of an office desk.

Fleckenstein said he has seen business rise 400 to 500 percent from 2009 to 2010 thanks in part to the NYSERDA grants.

Fleckenstein's brother, Joe, builds towers for the windmills and expects to hire two or three more employees.

Both plan to install towers on their farms in Porter with the help of NYSERDA grants. They said the approval process was relatively easy, and nearby residents responded favorably to the notices they received. Some even approached Joe Fleckenstein, who is getting about 50 percent in subsidies, about applying for their own.

Approval requires the acceptance of all neighbors within 750 feet.

In Cattaraugus County, some residents are battling to halt further large-scale wind turbine construction.

In Cambria, heavy public opposition contributed to the owners of Arrowhead Spring Vineyard being denied permission to power their winery and home with a wind turbine. The argument is now in the courts, with the vineyard owners arguing that the town's wind turbine law violates state law.

"I don't think anybody wants anything in their backyard," Joe Fleckenstein said. "People are thinking of these big, 450-foot wind towers and the problems (such as noise) that are associated with the big ones. It's a matter of the need to take a look at some of the ones that are already up."

Duggan-Lay said her neighbors were "wonderful." Though some objected to commercial-level wind turbines, they were fine with small residential generators.

e-mail: vsherry@buffnews.com

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